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Worldwide Exchange

News/Business. Ross Westgate, Kelly Evans. Ross Westgate and Kelly Evans consider the business stories that have global significance. New.

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Cyprus 21, China 12, Spain 8, Us 7, U.s. 7, Russia 6, Italy 6, Europe 4, Germany 4, Hertz 3, Banco Santander 3, Hugo Dixon 3, Ollie 2, Euros 2, Bailin 2, Bbva 2, Ben 2, S&p 2, Levy 2, Kelly 2,
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  CNBC    Worldwide Exchange    News/Business. Ross Westgate, Kelly Evans. Ross Westgate and  
   Kelly Evans consider the business stories that have global...  

    March 18, 2013
    5:00 - 5:59am EDT  

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certainly have a lot to be thankful for for our eighth anniversary. i want to thank mark hoffman, president and ceo of cnbc, who believed in me and said that this show could succeed. thank you, mark. i want to thank you for sticking with me. i always feel every single day when i come to work that this is the most exciting thing that has ever happened in my life. and i just got to tell you that
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you still keep coming up to me, you still say boo-yah and i am thrilled. people say is it over, it's just beginning. there's always a market somewhere. i promise to try to find it for you. i'm jim cramer and i will see you monday. woishg to "worldwide exchange." i'm kelly evans. these are your headlines from around the world. stocks are falling around the world as the controversial bank depositit levy sent shock waves through markets. lawmakers are scrambling to negotiate the rescue deal with international lenders reportedly trying to put more of the burden on savers with over 100,000 euros in banks. china's parliament is installing a new cabinet with the fresh premier to keep economic growth as its top
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priority. >> announcer: you're watching "worldwide exchange," bringing you business news from around the globe. welcome to "worldwide exchange" this morning. bank savings that will ease the burdens amid smaller deposits. this amid a $10 billion bailout deal. according to dow jones, the new proposal will see deposits under $100,000 euros taxed 3% while savers over half a million will see the levy kred to 10%. those above the threshold pay 9.9% tax. the total revenue raised is expected to hold just shy of 6 billion euros.
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the rescue package is slated to begin today around 1500 cet. in the meantime, we're getting comment out of russia. seen as perhaps the targeted party here, i should say, with regard to some of the deposit taxes that are being pushed through on cipriot banks. for example, putin via spokesman has apparently called the levy, if approved, unfair, unprofessional and dangerous. european markets are in the red across the board as we've seen today. the ftse 100 down almost 1% and the xetra dax better than 1%. the ibex 35 is down 2%, roughly the same amount for the ftse mib. we can tell you that spanish and italian bonds have risen both on banks and for some of the periphery, showing pressure, as well. here is a look at some european banks. a mix there. on the left, you can see spain. banco santander down almost 4% some some cases.
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unicredit down almost 5%. moving to the french banks, credit agricole and bnp are showing pressure down 3% to 4%. even in germany, down 2.4% there. a lot of concern will come down to just to what extent investors can assume even senior debt is protected going forward. we'll get to that discussion in just a second. in the meantime, look at the bond space. no rotating out of the periphery and into the safer haven trades this morning. yields falling below 1.9%. and the ten-year bund in germany is below 1.4% as the yield is spain is back above 5%. that spread is about 37 basis points at the minute, that's considerably wider than what we've seen over the last couple of weeks. forex, the euro/dollar is expected to be under pressure. it's holding up reasonably well, up 0.25%. after testing some of the lows
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below the 1.29 level has held up reasonably well. yen is strengthening, calling into question the extent to which the currency remains a bit of a safe haven trade. carolyn ross joins us now and julia chatterly is in rome. jules was following the meeting there into the wee hours of the morning where the surprise decision came out over the weekend. first, julia, you're on the ground. what is happening? >> people are outraged, rangery. they're if disbelief over this decision that was struck between the government and brussels leaders on saturday morning. but it's not just the people who are angry. it's also the politicians. many politicians in this 50/60 parliament in cyprus have said they would reject the bailout package because of the hugely unpop already deposit tax. press reports indicate that up to three parties could be volting against the bailout
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deal, which will be voted on in parliament later today. that's the debate and the vote are expected to kick off around 4:00 p.m. local time. so what the president is trying to do at the moment, he's trying to pure swede the members of parliament that this is the only solution going forward. if they vote against the bailout deal, the only alternative is bankruptcy for this country in the next couple of days. but it's going to be very, very crucial for the president to strong arm the other members of parliament into a positive decision on the bailout deal because at this point in time, he does not have a clear majority in parliament. he only has 20 seats. and even his junior coalition party, the democratic party, has voiced concern over this very controversial deposit tax. at the same time, though, we're hearing from the "wall street journal" the euro group
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ministers and the officials are talking about easing some of the burden for the smallest savers. we're hearing deposits of up to 100,000 euros could be taxed at only 3% as opposed to 6.75% as was announced before. whether that is too little too late, that remain toes be seen. but at this point, it is not clear how politicians are going to be voting today. okay. carolin, stay there. i want to bring jules into this discussion. we're getting comments from the ecb saying this is in the hands of the cypriot government to change the structure, this investment program. the key is that contributions amount to 578 billion euros and cypriot banks have access to liquidity. is it the case that come tuesday, post this bank holiday, that the ecb was basically going to close the door and say, sorry, no more liquidity, no more temporary emergency assistance after this date?
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>> the ecb remains there and the back stop will be there. if you look at that in reverse, there is obviously a threat. the question is whether if the vote doesn't go through, whether the ecb will turn around and said now we're going to turn off the liquidity taps and the ela. that's one of the things that cypress has to battle with right now. it's most definitely a question. but, of course, what you were talking about there, the suggestion we got from brussels on saturday morning was that the troika officials were happy, irrespective of how those levies were implemented as long as they got that 5.8 billion euros out of it. so it was the cypriots themselves allegedly that were trying to keep that high, the levy below 10%, 9.9%. and is then, of course, you back out based on the share of just
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how many deposits you have below that 100,000 in order to get the 6.75 rate. and it's interesting now theenl since they started talking about adjusting that lower levy downward towards 3%, let's say, that we're now hearing voices from the spokesman suggesting that this levy is unfair and is dangerous. remember, cyprus are balancing russia on both sides, and i have a great stat for you. 28% of the sti close in russia at the end of 2011 came from cyprus. five times the size in euro terms of cypriot gdp. i think that says it all of what the cyprion government are dealing with here. >> it sounds like part of the reason why everybody has been asking this question. why are small depositors being
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targeted? it sounds like it's partly so cyprus can balance its interest with russia. you could have raised the 6 billion targeted amount levy. do you think there's any chance at this point the government will accept or push for double digit losses on those with a higher denominated account? >> i think there's certainly a chance of that happening. of course, at this point, there is talk that those with deposits in excess of half a million euros will be taxed around 15%. and we know that these are primarily russians and ukrainians, wealthy russians and ukrainians who deposited much 06 their wealth here in cypress because of lax banking laws and there's been widespread allegations that these russians and ukrainians have used these accounts to launder some of their money and that is exactly why germany wanted depositors to
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take losses in this bailout. >> thank you so much. we'll have plenty more as we continue to follow this story. let's get straight to mark oswald who joins us around the table. mark, from an investor point of view, because there are a lot of different angles to this, how do you expect markets to react? what do people make of this today? >> i thought the initial reaction was quite appropriate when we marked spain and italy down in bond terms and buyback two points or about 20 basis points on. but pretty much on the all, there were buyers in there, which surprises me. it suggests within the marketplace and we've seen it within the rally of the euro, there is a degree of complacency that cyprus isn't really that important. this is a very specific issue and it's not going to unpick what mr. draghi has achieved, what's there in terms of the omt insurance. i wouldn't bet on it. >> you think that interpretation is wrong?
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>> i think that interpretation is wrong. the depositors are being bailed in. you couldn't bail in the senior bondholders. >> only about 2 billion euros is my understanding. >> yes. >> the reason why you couldn't have put more pressure on the bondholders is because it wouldn't have raised enough money? >> absolutely. but the principal of the bailin of a depositor means that for credit markets in general, we're setting a precedent of bailing in senior depositors and indeed senior bondholders who have always deemed themselves to be protected to be at the top of the credit chain. and that, in the long run, is a very dangerous precedent for everybody, particularly with credit spreads and current levels. >> because over the weekend, there were some strategists who said look, we're reassured that they're doing their utmost to protect senior debt. they're trying everything, pulling all the strings. but actually the point here is because this is a unique
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situation, they couldn't really involve senior debt holders to solve the problem. so your point is, is that, in fact, people are waking up and realizing if this could have solve the problem, they probably would have pulled that lever. >> they probably would have pulled that lever. i'm surprised they haven't involved it in some way. maybe there is a small element in there. i think the more important point is that when depositors in other countries, above all peripheral countries, obviously start, greece, but italy, spain, portugal, see what's going on in cypress, they must fear that their deposits aren't necessarily save. and it's going to take a gargantuan effort. even then, i'm not sure the average man on the street can be persuaded. but even then, and here is where i wonder if we're not overblowing this.. is the average man in spain or italy going to show up at the banks today or in the month acid, take out his money when
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everyone knows there was something a little unique about this situation that had to be addressed? >> to some extent, that's the line the politicians are going to take, that's the line the ecb is going to take, but there will be a small amount who will basically think their money is not safe with the banks. and i don't think that's an unfair conclusion that draw. there will be a lot more caution and if you see it in general at the moment, people are much, much more cautious and that's from small depositors up to big funds about what their bank counterpae counterparties are. it's in need of a lot of reform if we're going to protect small depositors. >> in a word, what's the trade today, then? >> perhaps the ironic one is nothing to do with the eurozone at all. it's to go after those people that started shorting gold. in this scenario, maybe gold does look like more of a safe
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haven. >> interesting. thank you so much for stopping by on a busy day. strategist at monument securities. straight ahead, we'll hear from the cypriot bank as to why they've headed down this road. carfirmation.
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you are watching "worldwide exchange." these are your headlines. european markets following asia into the red as the cyprus bailout rattles investor sentiments. the cyprus yot bailout will be voted on this afternoon. straight ahead on the program, china's premier has pledged to tackle prupgz and ensure economic stability, but with what policy? we'll be live in beijing to find out when we come back. [ kitt ] you know what's impressive? a talking car. but i'll tell you what impresses me. a talking train. this ge locomotive can tell you exactly where it is, what it's carrying, while using less fuel. delivering whatever the world needs, when it needs it.
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in the negative, but coming off their lows. the ftse 100 now down 0.75%. the cac 40 in paris, pulling in, as well. the ftse mib down better than 2%, of course, as european banks taking it on the chin as is also sovereign debt. we have the cypriot june bond yield following with its yield rising, more than doubling on the day to 70% and the 2020
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rising 2 percentage points on the day to yield 10.4%. this is interesting because if you take the line that goldman and others have, what we're seeing in cypress is losses being forced on depositors in banks is supposed to be a key policy shift in which public debt becomes more likely to benefit than bank debt. but again, we're not seeing that play out in markets and the spanish ten year is above 5%. for more of the impact this is having on global trade, li sixuan has been standing by in singapore to keep an eye on things. what can you tell us? >> thank you, kelly. nearly 3% tumble on the nikkei 225 retrieving from a 54-month high. the yen gained ground against the euro and the greenback, putting a lot of pressure on exporter stocks. automakers were down some 3% to 5%. japanese financials and industrials took a beating, ending well in the red. elsewhere, asian markets lost ground. in china, the shanghai composite dropped 1% today as the
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country's home prices continue to heat up in february, but are likely to be brought down by recent property curbs. auto eshg mas reversed gear today after the annual consumer rice program singled out a local -- over safety issues. in a grimmer picturing hong kong with the hang seng slipping 2% weighed down by blue chip names. financials, also the major drag today with hsbc tumbling over 2%. elsewhere, south korea's kospi lost nearly 1%, also broad based losses on the aussie market, the vsf 200 all ended weaker. india's sensex less than an hour from its market close now trading lower by 0.5%. back to you. >> sixuan, thank you very much for that. a lot of red across that board. this comes as china's national people's congress wrapped up on sunday with a call to do better.
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the country's new cabinet will be called on to make it happen. along them, sovereign wealth fund cic's chief is the new finance chief white xu shaoshin remains the minister. the national people's congress has wrapped up. the message is growth, but can the chinese government have it ever which way here trying to tackle all of these softer issues while at the same time keeping the country growing? >> right. well, that's a big question and especially people are talking about just how willing is this new leadership going to be? to really tackle those tough, tough challenges that they face. as you had said, li keiqang faced the press and he said all the right things from an inve investor perspective as well as
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a public perspective. this is one of the things he said about corruption. >> clean government should start with one's self. only one that is upright can he or she ask others to be upright. this is an ancient attache, but also the truth. we will gradually accept the supervision of the whole society and the media. when he was talking about having the media as a potential check for the government, at that very press conference, the "new york times" was not invited this time. so you can see in some ways the government is changing, but in other ways, it really is not. and that is essentially the message here and the reason why people are really wondering just how aggressive this new leadership will be when it comes
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to reform. kelly. >> eunice, thanks very much for that. it is chinese growth concerns helping markets shift into a bit of a risk this morning. still, who would have thought that sicyrus could upstage chin over the weekend? for more, let's speak to raymond young, senior economist at anc. raymond, what's your own view here as to whether china can keep up this growth pace while trying to address all of these concerns the population has? is it still achievable? >> hi, kelly. we think china has to attain a 1% growth this year even though the government has set a target of 7.5% growth. but with the legal challenge being the reformer with a strong push for urbanization, it seems
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that the government will inevitably push forward a large scale fiscal spending at the macro and national level. so 8.1% will be the final gdp figure, but we also see that we have the possibility of a moderate tightening before -- may see a correction towards the end of this year. >> and we look at commodity prices. we see copper at six month lows. do you think that's sniffing out this tightening stance, raymond? >> i think the markets now are react to go a possibility of this moderate tightening. they have spapded his term as a pboc governor has made that very clearly that inflation is now the top concern and we also saw that in the money market the pboc started to issue repro as opposed to reverse repo and to drain some of the liquidity from
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the money market. it seems the monetary condition at the moment is about right. but if we see six months of inflation, about 3% or maybe trending towards 3.5% then china will consider further tightening the money market and the liquidities condition in the economy and where we flexed in the capital markets these days. >> great point. raymond yung joining us. thanks very much. a reminder again that what we're seeing in markets today isn't just about cyprus. it could potentially be that seasonal time of year once again where global sitters come to the fore. straight ahead, find out why our next guest says the bank robbery is nothing more than legalized robbery. ery. ♪
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welcome back to "worldwide exchange." stocks falling around the globe with european banks deeply in the red as the cyprus bailout and controversial deposit levy sent shock waves into markets. lawmakers are scrambling to renegotiate the terms of the rescue deal with international rescuers trying to put motor of burden on savers in the banks.
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china has formed its new cabinet with the determination to keep economic growth its top priority. >> you're watching "worldwide exchange." cyprus is expected to unveil a new plan to take tax savings that will ease the burden on small deposits. according to dow swroens, the new proposal will be depositits under the dow euro 3%. while those 500,000 will see theirs increase to 15%. the total revenue raised is expected to hold at 5.8 billion euros. these concessions come ahead of a vote in parliament later today to approve a rescue package or
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not and that's slated to begin around 1500 cet. let's check on investors and see how they're taking this news. the dow is looking to shed more than 70 points at the open. the nasdaq and the s&p pointed for heavy losses, too. we have seen stocks in europe coming off their lows and the cnbc global 300 gives you a sense of what we've seen. putting in a bottom and climbing back from it. we're still down by 0.7%. here is what's happening across european markets. the ftse 1 is 00 continues to climb back out of the hold. it was down about 1% when we checked in at the top of the program. the xetra dax down 0.9 mers. what should you do in the light of the deal and investment in markets? here is what investors have been telling thus morning. >> right here, there are
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uncertainty webs but they're mostly linked to the political process in cyprus itself. if it does go through, i think it's a good thing and it will stabilize the situation. if we see a messy blowup with things getting out of control, i think then we would have to reconsider the positioning. >> we are now having the story that cyprus, but the mood in the market has dipped and we have to respect that. the further we go, the further the political uncertainty and the further the fundamental dates that will come in weak. at some point we'll expect in q2 it has potentially higher yield. but for the moment, it's predominant. >> that's the ironic one is nothing to do with the eurozone
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at all. it's going after those people that have started shorting gold because in this scenario, maybe gold does look like more of a safe haven. >> now, attention of course is immediately shifted the impact this is having on spanish and italian banks. while we can't necessarily look at target two claims, we can look at their shares prices. bbva down in spain almost 4%. interesting to see banco santander down 3%. bankinter down 11.3%. mediobank ya down just about 4%. joining me now, ali burrow, hugo dixon and core mechleach. hugo, we were just looking at italian banks and this is where you think we could see most of the fallout. well, that's the biggest risk.
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the biggest risk is italy. if there's going to be contagion, the worst thing is italy. certainly they've got form of doing this back in 1992. it's much, much smaller than what they're doing in cypress. 0.6% deposit tax in italy. they don't have a government. they're, in my view, unlikely to get a stable government for some time to come and they've got a hell of a lot of debt, about 130% of gdp. and there has been discussion there of having a wealth tax in order to try to reduce that huge debt burden of the italian state. that doesn't mean they have to have a deposit tax. there are other ways of having wealth taxes, which will be preferable. but that certainly is, i think, the biggest fallout risk from this. >> and is we're seeing that play out across markets. and you think as you've written that this amounts to legalized bank robbery. >> yes. >> what's happening in cyprus is an extraordinary and new and it
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sounds like something that should be illegal from your point of view. >> yes. what they've done is -- what they've done is they've found a work around. the deposit guarantee scheme. thee receipt cannily, up to 100,000 euros, you are guaranteed in cyprus. but what the government has done is taxed themselves them itself. and i think that's extremely bad. now, you said in the news that the reports coming out of nicosere are that we are going to have a rejigging of this tax. so there's a lower incident for the small depositors and a higher incidence for the bigger ones. even at 3% for the insured depositors, that is still too high. in my view, they should wipe it out completely and impose it totally on the uninsured ones
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with more than 100,000 in the bank. >> now, there may be some russian politics involved here, but ollie, you were saying it seemed a couple of weeks ago that markets weren't ready for a bailin. now you wake up and that appears to have changed. >> absolutely. i think it's very clear the direction of travel here from european politicians about what has to be done when banks fail. this is another example of whereby the banking system has its problems and is fraught over the government as we saw in ireland. and, you know, the european politicians have been scrambling over the last couple of years to figure out way toes break this nexus between governments and their banking system such as a single european deposit guarantee scheme. but the -- >> which by the way none of that exists. >> these actions over the weekend seems to blow both of those out of the water, quite frankly. >> i completely agree with hugo and oliver. this is clearly very concerning for depositors across europe.
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however, i think that people will increasingly view cyprus as a one off. i think the bank is too small. clearly a tax aiven for money laundering out of russia. oversized banking system. i think people sitting in italy and is spain will look at cyprus and not see much directory across themselves. once this gets off the front pages, i think things will slow down in terms of speculation. and i would view this as an opportunity to buy this, particularly in some of the uk banks that have, you know, potential qe about to come, a potential positive capitalist coming from the ftc not requiring it to raise more capital and limited exposure, for example, in the -- if you look at the likes of lloyds, they have limited exposure to the periphery of europe now. so i think there's an opportunity to buy the debt. >> and if we're coming off a situation where they didn't have enough debt to write it down
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significantly and solve the problem, there is almost no other option in a sense that who are we to protect? who are we to punish here and what red lines are we not to breach if we're ultimately working towards the same goal? is this not a fairly grownup solution, hugo? >> no. look, if it wasn't on the uninsured deposits, i would agree it was a grownup solution and that's what indeed i have written. but by hitting the insured deposits, that destroys confidence in the banking system. >> so is your only problem with this is people under is 00,000 euros that got hit? yes. >> that's your only problem with it? but it is a very big problem. but i think there is a chance of it being dealt with as we've seen. this morning, it looks like they've found a way to deal with that problem and i think there is pressure being exerted both inside and outside cyprus to get them to go the whole hog and those under the 100,000. but i'd like to say something
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about this that ollie said about the deposit guarantee scheme. there clearly is not a eurowide deposit scream. >> there has to be, doesn't there? >> no. this is not going to happen. after what's happened this weekend, actually, if you're sitting in germany, you're even less likely to want to have a european deposit scheme. if you had that, you would have she would out 30 billion euros to russian oligap if and money launderers and others. they're not going to do that. the solution to the european banking problem that needs to be pushed that not enough people are talking about is you've got to have more bailin debt. >> more capital available for these kinds of -- >> yeah. and the problem in the cyprus banks is there was almost no debt that could be bailed in. >> but ollie -- >> what you need to have, you need to have a pack of equity and bailin debt.
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>> at this point, have you just not waved the big red flag to investors? >> obviously. these thoughts that cyprus is too weak, every single bank failure that we've had, the responses to them have been wildly different. and this is just -- regardless of whether they go through with it, they've shown as to what is coming. bailin is supposed to be coming in 2018. but this pushes that button to bring it very far forward. >> which would be a good thing. >> look, if the crisis forces some of these measures, is that potentially a positive here or are we being unrealistic? >> i would expect that if we
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started to see, you know, a widespread liquidity run in spain or italy, they would start to be very vocal and very adamant that the deposit guarantee scheme is in effect in these countries and basically downplay the risk. and i think they would succeed in calming people's fears. if they didn't, i think they would get more aggressive. i think you would see aggressive qe coming from the ecb. frankly, the other scenario is complete meltdown of the european financial system. this is not, you know, we sell off 5% or 10%. this is we go to zero, right? so you could expect the troika to use all their bazookas to offset a liquidity run if it started to emerge. >> we'll have to leave it there. thank you all for joining me. i feel like we can keep this going. hopefully we will. ollie, hugo dixon, thank you. reuters breaking news as a tool on the website you can use if you want to play around with how much depositors should be on the
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hook for, check that out online. also, we want to hear what you think about whether the depositit levy should be can scrapped. vote online. the answers probably won't surprise you. we'll be right back here on "worldwide exchange." zap technology.
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welcome back to the program. the latest out of cyprus, the bank tax level is still under discussion and, in fact, the country is mulling a tax free threshold for that levy on smaller deposits. now we know that over the weekend, martin schultz said eld prefer to see depositors with less than 25,000 exempted. hugo dixon said his would be likely to see under 100,000. julia chatterly spoke exclusively to the cypriotic finance minister last weekend and asked them why they had gone back on their pledge depositors would not have to help foot the bill of a bailout. >> what we did accept is an exchange of relatively smaller part of somebody's deposit once
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and for all with shares in an institution. this is not a very agreeable outcome, for sure, but it compares well with much more serious -- much more serious than grave proposal that were on the table. >> my understanding is that the money that's remaining after the levy isn't going to be frozen in any way, so people could remove their deposit as of tuesday. is that right? >> absolutely. there is no capital restrictions. people can move. we hope people will believe us. they will believe the collective leadership of the european union. this was necessary, but single shot at the problem and that from now on they can be very
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confident that nothing will happen to their savings. >> and you're going to be closely monitoring those deposit flows. will you look to use capital controls if you have to? >> no, no. capital controls are not in the european union. we have the back stopping of the central bank and we expect that will be sufficient for stability to return to our banking system. >> can i ask you, head to go russia next week, how confident are you now that you have a european bailout deal in the works of getting more flexibility from them on the loan that they already have given to you? >> they're based on an indication and statement by our russian friends, having a framework of an agreement. in fact, the possibility of help with the russians facilitated their agreement and in some sense in a chicken and egg situation, now that we have an agreement, we hope that things
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will be easier in reaching some sort of agreement with our russian friend. >> and the europeans, you've managed to convince them that cypress isn't being used as a haven to avoid taxes or money laundering? >> i think so. we have agreed to a very fair analysis and we have committed to adopt this practice on the findings and the outcome of this parallel investigation. >> there's a long night for them. if you're just joining us here on "worldwide exchange," these are your headlines. european markets follow asia into the red as is cypress bailout rattles investor sentiment. ahead of the bailout vote today in parliament. and china's parliament has installed a new cabinet with a freshman date to prioritize economic growth. here is a look at a few other top stories.
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u.s. congress is still working on a debt deal. the senate is working through the continuing resolution to keep the government running until september. the house of representatives appears ready to pass the senate bill and the vote is scheduled for later today. both the house and senate go on easter break at the end of the week, and if no deal with reach, the u.s. government runs out of money on march 27th. chrysler is recalling 2500 dodge challengers due to a short circuit. the chrysler group says it's aware of seven such incidents and there have been no injuries reported. the company is contacted affected owners directly by mail and by phone. >> and as cyprus's bailout fears send global markets lower, we will head stateside as they engage the fallout on markets. stay with us.
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welcome back to the program. european markets are start to go drift lower again. the ftse mib is down 2%. the dax in germany holding up better. the ftse 1100, too. fwank stocks mostly taking it on the chin, though. whether we're talking about spain where bbva is down 3.7%, banco santander down 3%. it looks as though declines in the banks are leading this next leg lower. here is a quick look at what's on this week's agenda as we turn our attention to the u.s. the national association of home builders releases its march index today. the pboc meeting starts tuesday with tons of data for thursday including manufacturing index for march, the philly fed survey
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and is leading economic indicators. with all that to run through, here is a look at u.s. futures. the dow looking to shed better than 70 -- better than 80 points at the open. the nasdaq and s&p looking for significant declines, too. joining us in chicago is ben lichtenstein, president of tradersaudio.com. ben, we've been having this debate back and forth here. don't know if you caught it earlier. some say you buy into this weakness and others say this is a total game changer, steer clear of everything in europe. what do you think the impact will be on the u.s. today? >> i think we'll see add energy associated with the trade. they will probably be added participation and heightened volatility. i think that goes without saying. anyone who is going to tell you whether this is a buying opportunity or whether this will be a v-top opportunity is basically lying to you. i can't tell you that, either. i wish i could because i wouldn't be sitting in this chair if i could. but for the most part, again, i think you have to be aware of
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the fact that this has completely changed the game. and i think this goes without saying. the markets are reflecting that. one thing i'm shocked about is that we haven't seen an all-out sellout in terms of equity markets here. we have come off a bit, but holding key levels of support around that 1525 is a major level of support and we have yet to breach that yet. seeing some strength in the dollar coming off of that 83 level as of recent, but the euro currency is hurting below that 1.30 handle again. >> and yet we're showing you it's up 0.2%. this is hardly the picture of a plummeting world market that could have played out today. >> yeah. no question. but it was a different picture if you looked around midnight u.s. time. again, in between 10:00 to midnight, things were looking more severe. but the dollar right now is really what the markets are focused on. we saw the dollar retreat off that 83 even level last week towards the end of the week. stocks right now, for the most
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part, again, as i've seen, i think that we continue to see this value higher -- or value migrating to the upside. this is a bit of a pullback. but every pullback that we've seen since last november for the most part has been november 2012 has been a buy opportunity. and i think that will continue to be the case here against. this has the potential to rattle markets, there's no question, and we will see energy associated with this. but i still think that the status quo continues to be the case. i think that we're in a very low interest rate environment that continues to create this wealth effect and the money continues to go to the stock. >> got to leave it there, ben. thank you so much for your time today. >> thank you. >> want to show people quickly what's happening in gold and copper. copper is selling off. we talked briefly about china on the program, but the message should be it's not about a country of 1 million of 0.2% of zero gdp. it's about china and whether global growth jitters are coming back to the fore. with that in mind, we'll hand you over to "squawk box."
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thank you so much for tuning in. have a great day and hope to see you back here tomorrow.